Answer:
Material price variance = $3,950 unfavorable
Explanation:
A material price variance occurs where materials are purchased at a price either lower or higher than the standard price. A favorable variance is recorded where the actual total cost of materials is lower that the standard cost. While an adverse variance implies the opposite.
$
7,900 meters should gave cost ( 7,900× 17.70) 139,830
but did cost 143,780
Material price variance 3,950 Unfavorable
Material price variance = $3,950
Great Lakes Packing has two bond issues outstanding. The first issue has a coupon rate of 3.50 percent, a par value of $1,000 per bond, matures in 8 years, has a total face value of $3.6 million, and is quoted at 109 percent of face value. The second issue has a coupon rate of 5.94 percent, a par value of $2,000 per bond, matures in 21 years, has a total face value of $7.9 million, and is quoted at 95 percent of face value. Both bonds pay interest semiannually. The company's tax rate is 40 percent. What is the firm's weighted average aftertax cost of debt
Answer:
2.9652%
Explanation:
to determine the cost of debt we must use the FMV of the bonds plus the YTM:
first bond:
FMV = 1.09 x $1,000 = $1,090 x 3,600 bonds = $3,924,000
YTM = {C + [(F - P)/n]} / [(F + P)/2] = {17.5 + [(1000 - 1090)/16]} / [(1000 + 1090)/2] = (17.5 - 5.625) / 1045 = 1.136% x 2 = 2.27% annual
second bond:
FMV = 0.95 x $2,000 = $1,900 x 3,950 bonds = $7,505,000
YTM = {C + [(F - P)/n]} / [(F + P)/2] = {59.4 + [(2000 - 1900)/42]} / [(2000 + 1900)/2] = (59.4 + 2.38) / 1950 = 3.168% x 2 = 6.34% annual
total debt = $3,924,000 + $7,505,000 = $11,429,000
weighted average after tax cost of debt:
{($3,924,000/$11,429,000 x 2.27%) + ($7,505,000/$11,429,000 x 6.34%)} x (1 - 0.40) = (0.779% + 4.163%) x 0.6 = 4.942% x 0.6 = 2.9652%
At the end of August, Rothchild Company had completed Jobs 40 and 42. Job 40 is for 10,000 units, and Job 42 is for 11,000 units.The following data relate to these two jobs:On August 4, Rothchild Company purchased on account 12,000 units of raw materials at $14 per unit. On August 24, raw materials were requisitioned for production as follows: 5,000 units for Job 40 at $8 per unit and 6,200 units for Job 42 at $14 per unit.During August, Rothchild Company accumulated 3,500 hours of direct labor costs on Job 40 and 4,200 hours on Job 42. The total direct labor was incurred at a rate of $25.00 per direct labor hour for Job 40 and $23.50 per direct labor hour for Job 42.Rothchild Company estimates that total factory overhead costs will be $810,000 for the year. Direct labor hours are estimated to be 90,000.a. Determine the balance on the job cost sheets for Jobs 40 and 42 at the end of August.Job 40 $Job 42 $b. Determine the cost per unit for Jobs 40 and 42 at the end of August. If required, round your answers to two decimal places.Job 40 $Job 42 $
Answer:
1.
The balance of Job 40 = $159000
The balance of Job 42 = $223300
2.
The cost per unit for job 40 = $15.90 / unit
The cost per unit for job 42 = $20.30 / unit
Explanation:
The task here is to:
1. Determine the balance on the job cost sheets for Jobs 40 and 42 at the end of August.
2. Determine the cost per unit for Jobs 40 and 42 at the end of August.
Now; to start with the first question .
From the data given ; we can represents our given data in an imaginary table form and determine the balance on the job cost sheets for Jobs 40 and 42 at the end of August.
Let's have a go on that:
Particulars Job 40 Job 42
Raw material cost
(5000 units × $8 /unit) $40,000
(6200 units × $14 /unit) $ 86,800
Direct labor cost
(3,500 hours × $25 / labor hour) $87,500
(4,200 hours × $23.50 / labor hour) $98,700
Factory Overhead Cost
($810,000/ 90,000 labor hours)×3500 $31,500
hours
(($810,000/ 90,000 labor hours)×4200 $37,800
hours
Total cost $159000 $223300
Thus;
The balance of Job 40 = $159000
The balance of Job 42 = $223300
2.
Cost per unit = Total cost of the job / Number of Units produced
For Job 40; the cost per unit will be = $159000/ 10000
= $15.90 / unit
For Job 42; the cost per unit will be = $223300/ 11000
= $20.30 / unit
Thus;
The cost per unit for job 40 = $15.90 / unit
The cost per unit for job 42 = $20.30 / unit
Karl Corporation was organized on January 2, 2018. During 2018, Karl issued 40,000 shares at $24 per share, purchased 6,000 shares of treasury stock at $26 per share, and had net income of $600,000. What is the total amount of stockholders’ equity at December 31, 2018?
Answer:
$1,404,000
Explanation:
To calculate the total amount of stockholders’ equity at December 31, 2018 you have to use the following formula:
Stockholder’s equity= Paid-up capital+Retained earnings-Treasury stock
Paid-up capital= $24*40,000= $960,000
Retained earnings= $600,000
Treasury stock= $26*6,000= $156,000
Now, you can replace the values on the formula:
Stockholder’s equity= $960,000+$600,000-$156,000
Stockholder’s equity= $1,404,000
According to this, the total amount of stockholders’ equity at December 31, 2018 is $1,404,000.
Shankar Company uses a perpetual system to record inventory transactions. The company purchases inventory on account on February 2 for $34,000. In addition to the cost of inventory, the company also pays $540 for freight charges associated with the purchase on the same day.
Required:
Record the purchase of inventory on February 2, including the freight charges.
Answer:
Dr merchandise inventory($34,000+$540) $34,540
Cr accounts payable $34,000
Cr cash $540
Explanation:
The cost of inventory purchased is shown as an increase in merchandise inventory since perpetual system of inventory requires that inventory is updated each time there is a receipt or sale of inventory.
In other words, the cost of inventory purchased is debited to merchandise inventory and credited to accounts payable.
The cost of freight is also added to the cost of inventory while it is credited to cash account.
Answer:
The Record the purchase of inventory on February 2, including the freight charges would be as follows:
Debit Credit
February 2
Merchandise Inventory $34,000
Accounts Payable $34,000
(To Record the Company Purchases Inventory on Account)
Debit Credit
February 2
Merchandise Inventory $540
Cash $540
(To Record the Freight Charges Paid by the Company)
Explanation:
The Record the purchase of inventory on February 2, including the freight charges would be as follows:
The company purchases inventory on account on February 2, for $34,000, therefore, journal entry would be:
Debit Credit
February 2
Merchandise Inventory $34,000
Accounts Payable $34,000
(To Record the Company Purchases Inventory on Account)
The company also pays $410 for freight charges associated with the purchase on the same day. Therefore journal would be:
Debit Credit
February 2
Merchandise Inventory $540
Cash $540
(To Record the Freight Charges Paid by the Company)
Scoring: Your score will be based on the number of correct matches. There is no penalty for incorrect or missing matches.
Match each of the following formulas and phrases with the term it describes.
Clear All
(Actual Direct Labor Hours - Standard Direct Labor Hours) × Standard Rate per Hour
(Actual Rate per Hour - Standard Rate per Hour) × Actual Hours
(Actual Price - Standard Price) × Actual Quantity
(Actual Quantity - Standard Quantity) × Standard Price
Standard variable overhead for actual units produced
Direct labor time variance
Direct labor rate variance
Direct materials price variance
Budgeted variable factory overhead
Direct materials quantity variance
Answer:
Results are below.
Explanation:
Match each of the following formulas and phrases with the term it describes.
A) (Actual Direct Labor Hours - Standard Direct Labor Hours) × Standard Rate per Hour
This is the formula for Direct labor time (efficiency) variance
B) (Actual Rate per Hour - Standard Rate per Hour) × Actual Hours
This is the formula for Direct labor rate variance
C) (Actual Price - Standard Price) × Actual Quantity
This is the formula for Direct materials price variance
D) (Actual Quantity - Standard Quantity) × Standard Price
This is the formula for Direct materials quantity variance
E) Standard variable overhead for actual units produced
Budgeted variable factory overhead
Gramps purchased a joint survivor annuity that pays $500 monthly over his remaining life and that of his wife, Gram. Gramps is 70 years old and Gram is 65 years old. Gramps paid $97,020 for the contract. How much income will Gramps recognize on the first payment?
Answer:
$150
Explanation:
Calculation of how much income that Gramps will recognize on the first payment.
Since joint survivor annuity has 23.1 as the annual return multiple .
Calculation for Expected return
Expected return =Annual payment *Return multiple
($500*12) =$6,000
$6,000×23.1
=$138,600
Therefore :
$97,020/$138,600
=0.7×100
=70%
The 70% of each of the payment will be the return of capital while the 30%(100%-70%) will be the income.
Hence the first payment be:
30%×500
=$150
Therefore the amount of income that Gramps will recognize on the first payment will be $150
Pinnacle Corp. budgeted $259,470 of overhead cost for the current year. Actual overhead costs for the year were $209,420. Pinnacle's plantwide allocation base, machine hours, was budgeted at 49,190 hours. Actual machine hours were 56,270. A total of 102,050 units was budgeted to be produced and 98,000 units were actually produced. Pinnacle's plantwide factory overhead rate for the current year is:
Answer:
Predetermined manufacturing overhead rate= $5.275 per machine-hour
Explanation:
Giving the following information:
Pinnacle Corp. budgeted $259,470 of overhead cost for the current year.
Pinnacle's plantwide allocation base, machine hours, was budgeted at 49,190 hours.
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 259,470/49,190
Predetermined manufacturing overhead rate= $5.275 per machine-hour
"Widmer Company had gross wages of $320,000 during the week ended June 17. The amount of wages subject to social security tax was $320,000, while the amount of wages subject to federal and state unemployment taxes was $48,000. Tax rates are as follows:
Social security 6.0%
Medicare 1.5%
State unemployment 5.4%
Federal unemployment 0.8%"
The total amount withheld from employee wages for federal taxes was $46,000.
Required:
a. Journalize the entry to record the payroll for the week of June 17.
b. Journalize the entry to record the payroll tax expense incurred for the week of June 17.
Answer:
Dr salaries expense $320,000
Cr salaries payable $250,000
Cr medicare payable $4,800
Cr social security payable $19,200
Cr federal income taxes payable $46,000
Dr payroll tax expense $26976
Cr medicare payable $4,800
Cr social security payable $19,200
Cr state unemploymet tax payable($48,000*5.4%) $2592
Cr federal uneployment tax payable($48,000*0.8%) $384
Explanation:
The payroll for week of June 17 requires that salaries expense is debited with $320,000 while social security is credited with $ 19,200.00 ($480,000*6%).
Medicare is credited with $4,800 (1.5%*$320,000)
Federal income tax payable is $46,000
salaries payable=$320,000-$4,800-$19,200-$46,000
Acquired $51,000 cash from the issue of common stock. Paid $13,600 cash in advance for rent. The payment was for the period April 1, Year 1, to March 31, Year 2. Performed services for customers on account for $104,000. Incurred operating expenses on account of $43,000. Collected $79,500 cash from accounts receivable. Paid $37,000 cash for salary expense. Paid $34,400 cash as a partial payment on accounts payable. Adjusting Entries Made the adjusting entry for the expired rent. (See Event 2.) Recorded $5,600 of accrued salaries at the end of Year 1. Events for Year 2 Paid $5,600 cash for the salaries accrued at the end of the prior accounting period. Performed services for cash of $53,000. Purchased $4,400 of supplies on account. Paid $15,300 cash in advance for rent. The payment was for one year beginning April 1, Year 2. Performed services for customers on account for $120,000. Incurred operating expenses on account of $57,500. Collected $105,000 cash from accounts receivable. Paid $55,000 cash as a partial payment on accounts payable. Paid $33,100 cash for salary expense. Paid a $13,000 cash dividend to stockholders. Adjusting Entries Made the adjusting entry for the expired rent. (Hint: Part of the rent was paid in Year 1.) Recorded supplies expense. A physical count showed that $700 of supplies were still on hand. Problem 13-34A Part f f. Prepare a post-closing trial balance for December 31, Year 1.
Answer:
Post-Closing Trial Balance for December 31, Year 1:
Debit Credit
Common Stock $51,000
Cash $45,500
Rent Prepaid $3,400
Accounts Receivable $24,500
Accounts Payable $8,600
Salaries Payable $5,600
Retained Earnings $8,200
Total $73,400 $73,400
Explanation:
a) A post-closing trial balance lists balance sheet accounts containing positive balances for a financial reporting period. It agrees the total of all debit and credit balances. It includes the result from Income Statement.
b) The preparation of a trial balance may be pre-closing or post-closing. A pre-closing trial balance includes balances of both temporary and permanent accounts, and a post-closing trial balance excludes the temporary account includes the company's closing entries.
c) Cash Account:
Debit Credit Balance
Common Stock $51,000 $51,000
Rent $13,600 $37,400
Accounts Receivable $79,500 $116,900
Salaries Expense $37,000 $79,900
Accounts Payable $34,400 $45,500
d) Accounts Receivable
Debit Credit Balance
Service Revenue $104,000 $104,000
Cash $79,500 $24,500
e) Accounts Payable
Debit Credit Balance
Operating Expense $43,000 $43,000
Cash $34,400 $8,600
f) Salaries Payable
Debit Credit Balance
Salaries Expense $5,600 $5,600
g) Rent Prepaid
Debit Credit Balance
Cash $13,600 $13,600
Rent Expense $10,200 $3,400
h) Income Statement
Service Revenue $104,000
less Operating Exp 43,000
Gross Profit 61,000
less Expenses:
Rent 10,200
Salaries ($37,000 + 5,600) 42,600
Net Income $8,200
Mouret Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products.
Activity Cost Pools Activity Rate
Setting up batches $92.68 per batch
Processing customer orders $95.08 per customer order
Assembling products $3.41 per assembly hour
Last year, Product N79A required 28 batches,
6 customer orders, and 712 assembly hours.
Required:
How much total overhead cost would be assigned to Product N79A using the company's activity-based costing system?
Answer:
$5,593.44
Explanation:
The computation of the total overhead cost assigned to Product N79A using the activity based costing is shown below:
Total overhead cost assigned is
= Setting up batches cost + processing customer orders cost + assembly products cost
As we know that
Overhead Cost assigned = Activity Rate × Number of activity
So,
Setting up batches cost = $92.68 × 28 batches = $2,595.04
Processing customer orders cost = $95.08 × 6 customer orders = $570.48
And,
Assembling products cost = $3.41 × 712 assembly hours = $2,427.92
So,
Total overhead cost assigned to Product N79A is
= $2,595.04 + $570.48 + $2,427.92
= $5,593.44
Security Brokers Inc. specializes in underwriting new issues by small firms. On a recent offering of Beedles Inc., the terms were as follows: Price to public: $5 per share Number of shares: 3 million Proceeds to Beedles: $14,000,000 The out-of-pocket expenses incurred by Security Brokers in the design and distribution of the issue were $430,000. What profit or loss would Security Brokers incur if the issue were sold to the public at the following average price? $4.75 per share? Use minus sign to enter loss, if any. $ $5.75 per share? Use minus sign to enter loss, if any. $ $4 per share? Use minus sign to enter loss, if any. $
Answer:
a) -$180,000
b) $2,820,000
c) -$2,430,000
Explanation:
a) To calculate the profit or loss that the Security Brokers would incur if the issue were sold to the public at $4.75 per share, we have the following:
= (number of shares * price to public) - (proceeds to Beedles) - (out of pocket expenses)
= (3,000,000 * 4.75) - (14,000,000) - (430,000)
= -$180,000
The loss at $4.75 per share is $180,000
b) To calculate the profit or loss that the Security Brokers would incur if the issue were sold to the public at $5.75 per share, we have the following:
= (number of shares * price to public) - (proceeds to Beedles) - (out of pocket expenses)
= (3,000,000 * 5.75) - (14,000,000) - (430,000)
= $2,820,000
The profit at $5.75 per share is $2,820,000
c) To calculate the profit or loss that the Security Brokers would incur if the issue were sold to the public at $4 per share, we have the following:
= (number of shares * price to public) - (proceeds to Beedles) - (out of pocket expenses)
= (3,000,000 * 4) - (14,000,000) - (430,000)
= -$2,430,000
The loss at $4 per share is $2,430,000
Mexican Peso Changes. In December 1994, the government of Mexico officially changed the value of the Mexican peso from 3.22 pesos per dollar to 5.53 pesos per dollar.What was the percentage change in its value? Was this adepreciation, devaluation, appreciation, or revaluation? Explain. What was the percentage change in its value? The percentage change in peso value is ____%. (Round to two decimal places.)Was this a depreciation, devaluation, appreciation, orrevaluation? Explain. (Select all the choices that apply.)
A. Anytime a government sets or resets the value of its currency, it is a managed or fixed exchange rate. If that is the case, any change in its official value must be either a "revaluation" or "depreciation." In thiscase, a revaluation.
B. Anytime a government sets or resets the value of its currency, it is a managed or fixed exchange rate. If that is the case, any change in its official value must be either an "appreciation" or "devaluation." In this case, an appreciation.
C. Anytime a government sets or resets the value of its currency, it is a managed or fixed exchange rate. If that is the case, any change in its official value must be either a"revaluation" or "devaluation." In this case, a devaluation.
D. This is evident from the fact that it now takes more pesos per U.S. dollar, so its value is less or devalued. In terms of the percentage change calculation, this is indicated by the negative percentage change.
Answer:
The correct answer is options C na d D
Explanation:
Solution
There was a difference in value of Mexican peso by the government ranging from 3.22 pesos per dollar to 5.53 pesos per dollar.
Now,
The percentage change in percentage is given as:
(beginning - ending) / ending = (3.22 - 5.53) / 5.53
Hence, the value of peso of change in percentage is = -41.77%
Thus,
The value change in currency is known as devaluation.
For floating exchange rate case, currency either depreciates or appreciates with regards to the factors of market However,
In this given question,the government has set again the value of it's currency, it is known to be either fixed or managed exchange rate.
JBC Corporation is owned 20 percent by John, 30 percent by Brian, 30 percent by Charlie, and 20 percent by Z Corporation. Z Corporation is owned 80 percent by John and 20 percent by an unrelated party. Brian and Charlie are brothers. Answer each of the following questions about JBC under the constructive ownership rules of Section 267:<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />a. What is John's percentage ownership?b. What is Brian's percentage ownership?c. What is Charlie's percentage ownership? _________%d. If Brian sells property to JBC for a $6,000 loss, what amount of that loss can be recognized for tax purposes (before any annual limitations)?
Answer:
a. What is John's percentage ownership?
36%b. What is Brian's percentage ownership?
60%c. What is Charlie's percentage ownership?
60%d. If Brian sells property to JBC for a $6,000 loss, what amount of that loss can be recognized for tax purposes (before any annual limitations)?
$0Explanation:
JBC Corporation:
20 percent by John 30 percent by Brian30 percent by Charlie20 percent by Z CorporationZ Corporation:
80 percent by John 20 percent by an unrelated partyUnder constructive ownership rules of Section 267, family members included in constructive ownership are siblings, parents, grandparents, and children.
John owns = 20% + (20% x 80% of Z Corporation) = 36%
Brian = 30% + 30% (Charlie) = 60%
Charlie = 30% + 30% (Brian) = 60%
Following are two income statements for Alexis Co. for the year ended December 31. The left number column is prepared before adjusting entries are recorded, and the right column is prepared after adjusting entries. The company records cash receipts and payments related to unearned and prepaid items in balance sheet accounts.
Income Statements
For Year Ended December 31
Unadjusted Adjusted
Revenues
Fees earned $24,000 $ 30,000
Commissions earned 42,500 42,500
Total revenues $66,500 72,500
Expenses
Depreciation expense—Computers 0 1,500
Depreciation expense—Office furniture 0 1,750
Salaries expense 12,500 14,950
Insurance expense 0 1,300
Rent expense 4,500 4,500
Office supplies expense 0 480
Advertising expense 3,000 3,000
Utilities expense 1,250 1,320
Total expenses 21,250 28,800
Net income $45,250 $ 43,700
Analyze the statements and prepare the seven adjusting entries that likely were recorded. Hint: Entry for a refers to fees that have been earned but not yet billed. None of the entries involve cash.
Answer and Explanation:
The Journal entries are shown below:-
1. Accounts receivableDr, $6,000 ($30,000 - $24,000)
To Fees earned $6,000
(Being accrued income is recorded)
2. Depreciation expense - Computors Dr, $1,500
To Accumulated Depreciation - Computors $1,500
(Being depreciation expenses is recorded)
3. Depreciation expense - Office Furniture Dr, $1,750
To Accumulated Depreciation - Office Furniture $1,750
(Being depreciation expenses is recorded)
4. Salaries expense Dr, $2,450 (14,950 - $12,500)
To Salaries and wages payable $2,450
(Being salaries expenses is recorded)
5. Insurance expenses Dr, $1,300
To Prepaid insurance $1,300
(Being expired insurance is recorded)
6. Office supplies expense Dr, $480
To Office supplies $480
(Being office supplies expenses is recorded)
7. Utilities expenses Dr, $70 ($1,320 - $1,250)
To Accounts payable $70
(Being utilities expenses accrued is recorded)
Outdoor Luggage Inc. makes high-end hard-sided luggage for sports equipment. Data concerning three of the company’s most popular models appear below.
Ski
Guard Golf
Guard Fishing
Guard
Selling price per unit $260 $330 $205
Variable cost per unit $120 $180 $135
Plastic injection molding machine processing
time required to produce one unit 9 minutes 12 minutes 11 minutes
Pounds of plastic pellets per unit 12 pounds 7 pounds 11 pounds
Required:
1a.
The total time available on the plastic injection molding machine is the constraint in the production process. What is the contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard?
1b. Which product would be the most profitable use of this constraint?
Ski Guard
Fishing Guard
Golf Guard
1c. Which product would be the least profitable use of this constraint?
Ski Guard
Fishing Guard
Golf Guard
2a.
A severe shortage of plastic pellets has required the company to cut back its production so much that the plastic injection molding machine is no longer the bottleneck. Instead, the constraint is the total available pounds of plastic pellets. What is contribution margin per unit of the constrained resources for Ski Guard, Golf Guard and Fishing Guard?
2b. Which product would be the most profitable use of this constraint?
Golf Guard
Fishing Guard
Ski Guard
2c. Which product would be the least profitable use of this constraint?
Golf Guard
Fishing Guard
Ski Guard
3. Which product has the largest unit contribution margin?
Golf Guard
Fishing Guard
Ski Guard
Answer:
Ski Golf Fishing
Guard Guard Guard
selling price $260 $330 $205
variable cost $120 $180 $135
contribution margin $140 $150 $70
machine time 9 min. 12 min. 11 min.
lbs. of pellets 12 7 11
total machine time is the constraint in the production process
1a)
contribution margin per $933.33 $750 $381.82
machine hour
1b)
ski guard since its contribution margin per machine hour is much higher than the rest of the products
1c)
fishing guard since its contribution margin per machine hour is much lower than the rest of the products
2a)
Ski Golf Fishing
Guard Guard Guard
contribution margin per $11.67 $21.43 $6.36
lbs. of pellets
2b)
Golf guard since its contribution margin per lb. of pellets is much higher than the rest of the products
2c)
fishing guard since its contribution margin per lb. of pellets is much lower than the rest of the products
3)
Golf Guard ($150)
Consider three imaginary countries. In Aire, saving amounts to $4,000 and consumption amounts to $12,000; in Bovina, saving amounts to $3,000 and consumption amounts to $24,000; and in Cartar, saving amounts to $10,000 and consumption amounts to $50,000. The saving rate is
Answer:
The savings rate is higher in Aire than in Carttar and it is higher in cartar than in Bolivia.
Explanation:
To calculate savings rate:
[(Total income - consumption)/total income] x 100
Where total income = consumption + savings.
The savings rates are as follows
Aires: [(16000 -12,000)/16000] x 100
= 400/16
= 25%
Bovina: [(27000 - 24000)/27000] x 100
= 300/27
= 11.11%
Cartar: [(60000 - 50000)/60000] x 100
= 100/6
= 16.67%
The Containers Inc. experienced the following events during its first year of operations,
Year 1:
Acquired $42,000 cash by issuing common stock.
Earned $25,000 revenue on account.
Paid $18,000 cash for operating expenses.
Borrowed $10,000 cash from a bank.
Collected $22,000 of the balance in accounts receivable.
Paid a $1,000 cash dividend.
Required
a. Would the accounts receivable account appear in the assets, liabilities, or stockholders' equity section of the December 31, Year 1, balance sheet?
b. Determine the balance of the accounts receivable account that would appear on the December 31, Year 1, balance sheet.
c. Determine the amount of net income that would appear in the Year 1 income statement.
d. Determine the amount of the cash flow from operating activities that would appear in the Year 1 statement of cash flows.
Answer:
a. Would the accounts receivable account appear in the assets, liabilities, or stockholders' equity section of the December 31, Year 1, balance sheet?
The accounts receivable account would appear in the assets section, and more specifically, in the current assets section. This is because accounts receivable are considered to be an assset.
b. Determine the balance of the accounts receivable account that would appear on the December 31, Year 1, balance sheet.
The Containeres Inc. first earned $25,000 on account, and by the end of the year, it had collected $22,000, thus, the final balance of the accounts receivable is $3,000.
c. Determine the amount of net income that would appear in the Year 1 income statement.
Net Income = Revenue - Expenses
Net Income = $25,00 - $18,000
= $7,000
Concrete Consulting Co. has the following accounts in its ledger: Cash; Accounts Receivable; Supplies; Office Equipment; Accounts Payable; Jason Payne, Capital; Jason Payne, Drawing; Fees Earned; Rent Expense; Advertising Expense; Utilities Expense; Miscellaneous Expense.
Transactions
Oct. 1 Paid rent for the month, $2,800.
3 Paid advertising expense, $525.
5 Paid cash for supplies, $1,250.
6 Purchased office equipment on account, $9,300.
10 Received cash from customers on account, $16,600.
15 Paid creditors on account, $3,720.
27 Paid cash for miscellaneous expenses, $590.
30 Paid telephone bill (utility expense) for the month, $275.
31 Fees earned and billed to customers for the month, $50,160.
31 Paid electricity bill (utility expense) for the month, $830.
31 Withdrew cash for personal use, $1,700.
Journalize the following selected transactions for October 2019 in a two-column journal. Refer to the Chart of Accounts for exact wording of account titles.
Answer:
Oct. 1
Rent Expense $2,800 (debit)
Cash $2,800 (credit)
Oct 3.
Advertising Expense $525 (debit)
Cash $525 (credit)
Oct 5.
Supplies $1,250 (debit)
Cash $1,250 (credit)
Oct 6.
Office Equipment $9,300 (debit)
Accounts Payable $9,300 (credit)
Oct 10.
Cash $16,600 (debit)
Accounts Receivable $16,600 (credit)
Oct 15.
Accounts Payable $3,720 (debit)
Cash $3,720 (credit)
Oct 27.
Miscellaneous Expense $590 (debit)
Cash $590 (credit)
Oct 30.
Utilities Expense $275 (debit)
Cash $275 (credit)
Oct 31.
Accounts Receivable $50,160 (debit)
Fees Earned $50,160 (credit)
Oct 31.
Utilities Expense $830 (debit)
Cash $830 (credit)
Oct 31.
Capital; Jason Payne $1,700 (debit)
Cash $1,700 (credit)
Explanation:
Transactions are recorded when they occur or incur according to Matching Principle.
Note ; Cash withdrawals reduce the owners capital account and decreases the assets of cash.
Suppose on Friday night you have a choice to go either to a Katy Perry concert or a Lady Gaga concert. You won a free ticket to see Katy Perry. You would pay as much as $180 to see Lady Gaga perform, but tickets to her show cost $100 . Assume that you end up going to the Katy Perry concert. Since you went to the Katy Perry concert, you must be willing to pay at least $________to see Katy Perry.
Answer: $100
Explanation:
From the information, on a Friday night, you have the choice to either go to a Katy Perry concert or a Lady Gaga concert. You won a free ticket to see Katy Perry but you would pay as much as $180 to see Lady Gaga perform, even thought the tickets to her show cost $100.
This illustrates that the person must be willing to pay at least $100 to see Katy Perry. Since the person wa.willing to pay $180 for Lady Gaga even when the tickets were$100, then you should be able to pay at least $100 to see Perry
The equipment account had a $36,000 balance at the beginning of the year, and a $30,000 balance at the end of the year. The accumulated depreciation account had a balance of $22,000 at the beginning of the year, and a $17,000 balance at the end of the year. The income statement reported depreciation expense of $4,000 for the year. Equipment costing $10,000 was sold for its book value. Cash received from the sale to be reported in the Investing Activities section is
Answer:
$1000
Explanation:
The cash received from the equipment sale is equals to the initial cost of the equipment which is $10,000 minus total accumulated depreciation on the equipment charged till date.
Total accumulated depreciation on the equipment=Opening balance of accumulated depreciation+depreciation charge for the year-closing balance of accumulated depreciation
Total accumulated depreciation on the equipment=$22,000+$4,000-$17,000
=$9,000
cash proceeds=$10,000-$9,000=$1000
10. Leon, a minor, signed a contract with Step-Up Employment Agency, in which Leon promised to pay a fee if Step-Up secured him a job as a pianist. Step-Up did find suitable employment, but Leon refused to pay the $500 fee since he was a minor. Can Step-Up recover the fee
Answer: No. Step Up can't recover the fee.
Explanation:
From the information given in the question, we are told that Leon, who is a minor, signed a contract with Step-Up Employment Agency, where he promised to pay a fee on the condition that Step-Up Employment Agency gets him a job as a pianist. Leon tyem refused to pay the $500 after h was given the job.
In this scenario, for Step Up Employment Agency to get their fee, that means they must have signed a legal contract with Leon. From them to sign a legal contract, the person must be a major but we are told that Leon is a minor. Even if there was a legal contract, it will be void since Leon is a minor. Therefore, Set -Up Employment agency will not be able to recover the fee.
TEB budgeted the following production cost for 1,000 units of product for job 588 during 20XX: Direct Materials (DM) 400 pounds at $5 per pound $ 2,000 Direct Labor (DL) 1,500 hours at $15 per hour 22,500 Manufacturing Overhead (MO) 1,500 Machine hours at $10* per machine hour 15,000 Total 39,500 *$60,000 estimated overhead for the year divided by 6,000 estimated machine hours for the year = $10 estimated overhead per machine hour. TEB, Inc. incurred the following actual costs for job 588: Direct Materials (DM) 420 pounds at $5.50 per pound $ 2,310 Direct Labor (DL) 1,540 hours at $14.50 per hour 22,330 Manufacturing Overhead (MO) $62,000 actual overhead for the year; 5,900 actual machine hours; 1,600 actual machine hours used on job 588 ? Compute the total cost (DM, DL, and MO) of job 588 using standard costing Using standard costing, what is the total job cost?
Answer:
Total Product cost for Job 588 is $ 41,453
Explanation:
Direct Materials (DM) = 420 pounds at $5.50 per pound = $ 2,310
Direct Labor (DL) = 1,540 hours at $14.50 per hour = $22,330
Manufacturing Overhead (MO) $62,000
actual overhead for the year; 5,900
actual machine hours; 1,600 actual machine hours used on job
Total Product Cost:
Overhead = ($62,000 ÷ 5,900) × 1600 = $16,813.56
Total Product Cost for Job 588 = $2,310 + $22,330 + $16,813.56
= $ 41,453.56
Total Product cost for Job 588 is $ 41,453
Cite 3 reasons for and 3 reasons against rebuilding Greensburg as a “green town.”
Answer:
Following are the answer to this question:
Explanation:
3 reasons:
1. The tornado has always been something like never before in magnitude. Its city was damaged and 95% of its buildings are damaged. It gives you the chance to rebuild and green the city.
2. Building a green city would also inspire other cities to implement green technology in a tornado-ravaged area.
3. Greenburg is going to become a style icon and a model for the construction of a renewable town.
3 counter reason:
1. firstly, green technology is not inexpensive and would put public funds under pressure.
2. No one would cause a major lack of economic and private assets if Greenburg has been struck by a tornado of the very same size.
3. Its town can prioritize constructing tornado shelters that can respect and public assets rather than creating a green community.
Handel Company uses the allowance method for estimating uncollectible accounts.
January 5 Sold merchandise to Terry Richman for $2,000, terms n/15.
April 15 Received $600 from Terry Richman on account.
August 21 Wrote off as uncollectible the balance of the Terry Richman account when she declared bankruptcy.
October 5 Unexpectedly received a check for $300 from Terry Richman. It is not felt any more will be received from Richman.
Prepare journal entries to record the above transactions.
Answer: Please refer to Explanation.
Explanation:
January 2
DR Accounts Receivable - Terry Richman $2,000
CR Sales $2,000
(To record sale of goods to Terry Richman on Account)
April 15
DR Cash $600
CR Accounts Receivable - Terry Richman $600
(To record cash received from Terry Richman)
August 21
DR Allowance for Doubtful Debt $1,400
CR Accounts Receivable - Terry Richman $1,400
(To record write off of Terry Richman Account)
October 5
DR Accounts Receivable - Terry Richman $300
CR Allowance for Doubtful Debt $300
October 5
DR Cash $300
CR Accounts Receivable $300
(To record Cash Received from Terry Richman)
Workings and Notes.
Terry Richman paid $600 out of their $2,000 debt before declaring bankruptcy.
= 2,000 - 600
= $1,400.
This is why $1,400 was the written off figure.
When an Receivables account is written off, it is debited to the Allowance for Doubtful Debt Account.
When money is unexpectedly received after a write off, the amount first has to be retrieved from the Allowance for Doubtful Debt and taken back to the Accounts Receivables and then it can be recorded as Cash received.
This year, Druehl, Inc., will produce 57 comma 60057,600 hot water heaters at its plant in Delaware, in order to meet expected global demand. To accomplish this, each laborer at the plant will work 160160 hours per month. If the labor productivity at the plant is 0.250.25 hot water heaters per labor hour, how many laborers are employed at the plant
Answer:
The number of laborers employed by the plant is 120 laborers
Explanation:
According to given data Annual output = 57600 water heaters.
So the output per month = 57,600 / 12 months = 4,800 water heaters
Each labor works 160 hours per month
Suppose ,there are x number of laborers employed by the plant. So,x number of laborer will work 160x hours per month. So the labor input = 160x per month
Labor productivity = 0.25
Labor productivity = Output / Labor input
0.25 = 4800 / 160x
25/100 = 4800/160x
160x = (4800 X 100) / 25
160x = 19200
x = 19200/160
x = 120
Therefore, the number of laborers employed by the plant is 120 laborers
The manager of Belle Home Improvements purchased several cash registers for the business on June 10 but does not remember whether he paid cash for the full price or still owes a balance to the vendor. Where is the best place for the manager to get the information about this transaction?
Answer:
The best place to get information about the transaction is the general journal.
Explanation:
The best place for the manager to get information about the transaction is the general journal.
The journal in accounting is a record of financial transactions in order by date. The general journal is a day book that records transactions as it relates to adjustment entries, opening stock, accounting errors. Entries in general journal includes dates and explanation of transaction called narration.
The manager can find out if he paid fully for the transaction by going through the narration in the general journal.
Lott Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2020, Job 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $21,200, direct labor $12,720, and manufacturing overhead $16,960. As of January 1, Job 49 had been completed at a cost of $95,400 and was part of finished goods inventory. There was a $15,900 balance in the Raw Materials Inventory account.
During the month of January, Lott Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were also sold on account during the month for $ 134,200 and $ 173,800 , respectively. The following additional events occurred during the month.
1. Purchased additional raw materials of $ 99,000 on account.
2. Incurred factory labor costs of $ 77,000 . Of this amount $ 17,600 related to employer payroll taxes.
3. Incurred manufacturing overhead costs as follows: indirect materials $ 18,700 ; indirect labor $ 22,000 ; depreciation expense on equipment $ 13,200 ; and various other manufacturing overhead costs on account $ 17,600 .
4. Assigned direct materials and direct labor to jobs as follows.
Job No. Direct Materials Direct Labor
50 $ 11,000 $ 5,500
51 42,900 27,500
52 33,000 22,000
Required:
Calculate the predetermined overhead rate for 2020, assuming Lott Company estimates total manufacturing overhead costs of $924,000, direct labor costs of $770,000, and direct labor hours of 22,000 for the year.
Answer:
Predetermined manufacturing overhead rate= $42 per direct labor hour
Explanation:
Giving the following information:
Estimated manufacturing overhead= $924,000
Estimated direct labor hours= 22,000
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 924,000/22,000
Predetermined manufacturing overhead rate= $42 per direct labor hour
What is the purpose of a labor union?
Calculate the interest expense that Jessie Co. will show with respect to these bonds in its income statement for the fiscal year ended September 30, 2019, assuming that the premium of $82,000 is amortized on a straight-line basis.
Answer:
Find below missing part of the question:
Jessie Co issued $2 million face amount of 7%,20 years bonds on 1 April 2019.The bonds pay interest on semiannual basis on 30 September and 31 March each year.
$67,950.00
Explanation:
Interest expense=semiannual coupon-semiannual premium amortization
semiannual coupon =face value*coupon rate
face value is $2 million
coupon rate is 7%
semiannual coupon =$2,000,000*7%*6/12=$ 70,000.00
semiannual premium amortization=premium/years to maturity*2
premium is $82,000
years to maturity is 20
semiannual premium amortization=$82,000/(20*2)=$2050
interest expense=$70,000-$2,050=$67,950.00
Removal for cause is a device used to prevent a prospective juror who is biased from serving on a case. true or false
Answer:
True
Explanation:
A Juror is a member of a jury in a court of law. It is expected that a Juror carries out his / her duty with a maximum objectivity without being partial or bias. For this reason , a set of criteria are used to screen potential Jurors during selection and if any is sound unqualified , such will be prevented from being part of a Jury.
The two methods of screening are peremptory where the attorney removes a Juror without giving any reason and the removal for cause where the potential Juror is removed because it is perceived that he will be impartial in the course of duty.
